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1. A machine costs $20,000 and is expected to have a ten year life. It will be depreciated straight-line over its ten year life to
1. A machine costs $20,000 and is expected to have a ten year life. It will be depreciated straight-line over its ten year life to a zero salvage value and is expected to reduce the firms cash operating costs by $3,000 per year. If the firms tax rate is 50 percent, what estimated Year 1n net cash flows will the machine generate? a) $ 5,000 b) $ 2,500 c) $ 1,500 d) $ 2,250
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